What will the retail scene look like in the future?
Will clever sensors recognize you as you go into the store? What about holographic floating product displays that alter as you walk down the aisles?
Perhaps an army of artificial intelligence (AI)-powered robots will serve you. Alternatively, a smart mirror equipped with augmented reality (AR) technology will display your preferred clothing.
With a single swipe, you may alter the colour of the garment and see what footwear would fit with it. And when you’re done buying, you’ll scan and pay instead of waiting in a queue at the checkout counters.
Or maybe you’ll simply shop from home using virtual reality (VR) headsets, and drones will drop deliveries at your doorstep.
1. The Continued Rise of the Metaverse
In the years ahead, specifically in 2023 and beyond, the Metaverse is anticipated to emerge as a significant trend within the retail sector. Rapid expansion is propelled by various factors, prominently the expanding adoption of virtual reality technology within the retail domain.
Within the Metaverse, retailers have the capacity to craft immersive, interactive scenarios that empower customers to virtually test clothing, experiment with products, and even explore virtual storefronts. This not only enhances the overall consumer experience but also offers companies the opportunity to gather essential insights into customer preferences and behaviours.
2. AI, Machine Learning (ML), and Generative AI
AI and machine learning technology have permeated many industries, including retail. Indeed, the retail business has long served as a testing ground for AI technologies.
The recommendation engine created by Amazon over two decades ago is the most popular usage of AI by a merchant. consumers are recommended comparable goods by the ML algorithm based on their past buying history, geography, and the purchase patterns of other similar consumers. Retailers must invest more in AI and similar technologies in the future.
3. Web3 Will Continue to Advance
Anticipated to surge in the years ahead, particularly in 2023 and onward, Web3, often dubbed the decentralized web, stands out as a significant advancement. This innovative technology empowers users to directly connect to the internet without reliance on a central authority, affording them heightened autonomy over their online interactions.
At the core of Web3 lies blockchain technology, a driving force that facilitates the establishment of secure and transparent networks suited for diverse applications such as supply chain management, voting systems, and peer-to-peer markets. One of the pivotal merits of Web3 lies in its capacity to give rise to fully decentralized applications, or “dApps.” These applications operate on blockchain networks rather than conventional servers, relinquishing control from a singular entity.
Another area where merchants must increase their spending in 2024 is automation, which is the use of technology to execute repetitive operations with minimum human participation. According to Gabriella Bock, the continuous labor shortages have fueled the demand for automation in every part of the retail business, from warehousing, inventory management, and order fulfilment to consumer-facing features like contactless payments.
According to McKinsey, current technology can automate 52% of all retail processes. It lowers human mistakes improves service quality and speed, increases staff productivity, and saves money. For merchants facing margin difficulties, automation can deliver 300 to 500 basis points of incremental profit. In the hyper-competitive retail market, automation is no longer an option but a need.
5. Enriching Payment Modes
In a market like India, both shops and online merchants are constantly improving the consumer’s overall purchasing experience. Many stores now provide “buy online, pick-up in-store” (BOPIS) services in addition to same-day delivery and online shipping. However, because there are so many different ways to order products, businesses must exercise extra prudence when using point-of-sale systems.
Accepting a variety of digital payment methods enhances the consumer experience by offering uniformity and convenience. Accepting QR code payments, buy-now-pay-later (BNPL), virtual payments such as Google Pay, and even e-money can increase accessibility for both offline and online buyers.
Finally, the dynamic retail scene is witnessing a major transition in 2023, owing to a confluence of technical breakthroughs. The five trends mentioned above AI-powered personalization, immersive shopping experiences, frictionless checkout solutions, sustainable practices, and data-driven insights will shape the future of retail, redefining how businesses engage with consumers and how consumers interact with brands.